Meeting on developing agriculture in the central non-black earth regions

Vladimir Putin held a meeting on developing agriculture in the central non-black earth regions.

July 28, 2016

14:00

Dmitrova Gora, Tver Region

Before the start of the meeting, the President visited the production facilities at the Dmitrogorsky meat processing plant.

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President of Russia
Vladimir Putin: Good afternoon, colleagues,

We are here today to discuss development of agriculture in the central non-black earth zone,
non-black earth regions of Central Russia.

We have just visited the facilities here. This was an interesting visit that showed us a promising, fast
and effectively developing business, which obviously makes us happy. They
started work here not so long ago at all, around 10 years ago, but have gone a long way since then. When did you begin?

Response: In 2006.

Vladimir Putin: Over these 10 years, you have developed a good, full-fledged and effectively operating business.

I remind you that of the 18
regions in the Central Federal District 12 are non-black earth regions. They
are Tver, Yaroslavl, Vladimir, Bryansk, Kaluga, Ryazan, Tula, Ivanovo,
Kostroma, Moscow, Orel and Smolensk regions.

Agricultural
conditions in the central non-black earth regions are certainly not as good as in the Krasnodar Territory or the Don River region, for example, but these regions
have considerable potential nonetheless.

As I was
discussing just before with the Acting Governor, these regions’ competitive
advantages include proximity to big sales markets and traditionally good
conditions for developing livestock and processing of agricultural produce.

We must
put these advantages to work of course and improve the efficiency of those
sectors that are guaranteed to produce returns. Some regions are already
engaged in this effort and have programmes making agriculture a priority. They
have taken support measures for the sector and are bringing in investors, which
is particularly important for carrying out large-scale projects. Large meat,
dairy and greenhouse facilities have already been built in the Bryansk, Kaluga,
Orel, Smolensk and Tver regions, for example.

We need to take these kinds of positive examples as models. We are meeting today at one of these production centres. While visiting the facilities, we noted that it would
have been hard to find such a place a decade ago, not just here but anywhere in Russia. We had hardly any such places back then.

I am sure
that there is much potential yet for developing the sector and making it more
effective and for opening production facilities in other non-black earth
regions in central Russia too. Let me note that the state authorities continue
to give you the needed support. This year alone, we have earmarked 23 billion
rubles for agriculture development measures in the central non-black earth
regions. This is three billion more than in 2015, when the figure was around 20
billion − 19.8 billion.

I remind
you that this money is allocated through the state programme for developing
agriculture, which has total funding of 224 billion rubles. We must use these
resources effectively, including by improving the system for subsidising
agricultural producers. We need to make this system clearer and more
transparent, get the money to concrete recipients in timely fashion and exercise tight control over how the money is spent, of course. We need to ensure that the money does not go on projects that cannot produce results.

I want to discuss with you today the steps we must take for this. Let me note several key
issues.

First, as far as plant crops go, we need to make the sector more effective by introducing
modern technology, carrying out active irrigation measures that will improve
crop yields, and start cultivating land that is currently not being used for its primary agricultural purpose. I remind you that I raised this issue in my [Annual Presidential] Address in 2015.

In this,
as in other sectors, we need to attract investors, private investors above all,
and establish good, constructive ties with financial institutions. The needed legal
conditions have already been drafted as concerns buying and selling
agricultural land. I ask the regional authorities to be mindful of the agricultural producers’ needs and not create excessive difficulties with
drawing up the required documents in this area.

Let me
remind you that in Russia as a whole, there are more than 12 million hectares
of agricultural land that are not being used for agricultural purposes. Here in the Tver Region alone, there are 2.8 million hectares of unused fields that could
be used for agriculture but are currently not being cultivated.

In this
respect, let me repeat again, regarding the legal aspect of this issue, that
the legislators took a decision on land withdrawal. On July 3 this year,
amendments were passed that make it possible to seize land if it is not put to its proper use over a three-year period. The new owner must start cultivating
the land within the first year after acquiring the land.

What is
very important here is that the authorities should not create artificial
difficulties for the new owner in these cases. It is unacceptable if the new
owner, who has a year to get the land working, spends his time running
from one office to another doing paperwork. On the contrary, all these
procedures should be fast, efficient and of high quality. And the financial
institutions will need to get involved too to ensure the necessary financing.

Furthermore, when
cultivating new land, it is particularly important to focus on the crops best
suited to the climate in the non-black earth regions. As you know, these crops
include potatoes, flax, and crops used for feed and oils.

Second, we must
develop deep processing activity, and not just build new processing facilities for agricultural products but ensure they have the orders they need to operate
effectively. Currently, facilities for processing seeds into oil have capacity but are standing idle
because of shortages in raw materials. Our production capacity can produce up
to 20 million tonnes of raw materials, but Russia is producing only 14 million
tonnes. Vegetable oils, as well as grain, are valuable export goods. Russia has
been the world leader for wheat exports over this agricultural year. This is an excellent result for our producers: they exported 24.6 million tonnes compared
to 21 million tonnes in 2014–2015.

I think that our
plant oil producers also have good prospects for strengthening their positions
on export markets, as I just said.

Third, developing
greenhouse vegetable production is also a big priority. This is not a new task,
but development in this sector has been very slow. Gross vegetable crop yields
increased by 6 percent in the non-black earth central regions in 2015, but
production of greenhouse vegetables fell by 13.7 percent.

Last year, I gave
the instruction to develop and introduce mechanisms that would make it possible
to reduce or compensate electricity costs for greenhouse vegetable production.
I would like to hear today about what is being done here.

Now, on livestock,
with the help of substantial state support, development of pig and poultry
farming has been rapid over the last decade. I was pleased to hear from a boss of the farm we visited
today that the decisions we made and the agricultural development production programme
we adopted in 2005 made it possible for new agricultural businesses to take
their first steps and reach the point where they are at today. It is sufficient
to say that our ability to cover domestic pork and poultry demand has increased
from 60 to 95 percent, which is a very good result.

In 2015, for the first time in many years, we reached and even surpassed the food security
threshold set for meat in our food security doctrine. The share of domestically
produced meat has reached 88 percent of all meat on the market, and the food
security doctrine set an objective of 85 percent.

Unfortunately, we
do not have such a positive dynamic in cattle farming for meat and dairy
products, and I’m referring to beef cattle in the first place. I believe that these sectors should
become key areas for the central non-black earth regions’ development. I would
like to repeat that these regions have the resources for this: extensive land
and the resources needed for ensuring livestock feed.

In this respect, I ask you to develop mechanisms for making livestock and dairy cattle breeding in the central
non-black earth regions more effective and attracting farmers to this sector.
In particular, I propose examining possibilities for increasing the size of grant support from 1.5 million rubles to 3 million rubles for farmers starting
out in dairy farming and livestock and from 21 million rubles to 30 million
rubles for family-run livestock farms.